The issue of drug–drug interactions has generated significant concern within the pharmaceutical industry and amongst regulatory authorities in recent years. This has arisen with respect to early termination of clinical development (e.g. furafylline), refusal of approval (e.g. mibefradil in Sweden), severe prescribing restrictions and withdrawal from the market (e.g. sorivudine, terfenadine, mibefradil, astemizole, cisapride), and threatened litigation. This report summarizes the outcomes of a conference held in Basel in November 2000, under the auspices of the European Federation of Pharmaceutical Sciences (EUFEPS), the US Food and Drug Administration (FDA) and the American Association of Pharmaceutical Sciences (AAPS). The meeting followed on from two previous workshops on drug interactions held in Nuremberg (1997) and Arlington (1999) sponsored by the same groups. Whereas previous conferences had identified the main areas of contention, a specific aim of this meeting was to attempt a consensus on the conduct of in vitro and in vivo studies of metabolic and transport interactions. There were five main conference sessions, in which experienced scientists from academia, industry and regulatory bodies were invited to contribute short presentations formulated, where possible, to address specific questions: Session 1. Mechanistic considerations. Moderators: S. E. Clarke, S. Wrighton; Speakers: A. Boobis, J. B. Houston, S. D. Hall, S. Ekins, P. Maurel, H. Lennernaes. Session 2. In vitro assessment;Moderators: J. B. Houston, K. Thummel; Speakers: B. G. Lake, J. Lipscomb, T. Lave, R. S. Obach, S. Wrighton, S. E. Clarke, P. Langguth, L. Z. Benet, C. Crespi, E. LeCluyse. Session 3: In vitro prediction. Moderators: G. T. Tucker, L. Z. Benet; Speakers: K. Thummel, T. Andersson, B. Clement, H. Suzuki, V. Fischer, M. Dickens, J. Lin, P. Watkins, A. Rostami-Hodjegan. Session 4: In vivo assessment. Moderators: S-M. Huang, U. Fuhr; Speakers: K. S. Reynolds, R. A. Branch, G. Blakey, G. T. Tucker, U. Fuhr, V. Steinijans, P. Milligan, G. Alvan. Session 5: The regulatory view. Moderator: G. Alvan; Speakers: S-M. Huang, Y. Ohno. In addition, the speakers were organized into panels with chairpersons and rapporteurs to develop position statements on the main issues in breakout sessions. These were then presented in open forum at the final session and modified to take account of debate. We have attempted to distil the key features of the discussions with respect to resolved and unresolved issues.